The World Bank has released a list of the top 10 countries indebted to China as of 2022.
According to the list, Pakistan leads the pack with a whooping $26.60 Billion in loans.
The debt is mainly due to the China-Pakistan Economic Corridor, a flagship project of China’s Belt and Road Initiative (BRI).
Second on the list of countries indebted to China is Angola with $20.98 Billion.
The African country’s debt to China accumulated via loans for rebuilding infrastructure after its civil war. China has invested heavily in Angola’s oil sector, swapping loans for oil shipments. While the investments have helped rebuild the country, they have also created a dependency on Chinese finance and increased vulnerability to oil price fluctuations.
Next on the list is Sri Lanka with $8.84 Billion. Sri Lanka’s debt to China has remained a subject of international scrutiny following the 99-year lease of the Hambantota Port to a Chinese firm after Sri Lanka defaulted on its loans.
The scenario has raised concerns about the potential debt trap diplomacy, where excessive borrowing from China could lead to the loss of sovereign assets. Sri Lanka’s economic prospects remain precarious, with ongoing challenges to balance development needs with debt repayment.
Another country on the list of China’s indebtedness according to the World Bank is Ethiopia.
Ethiopia’s debt to China is $6.82 Billion.
The East African country’s debt to China has been used to develop infrastructure, including the Addis Ababa-Djibouti Railway and various industrial parks.
Experts believe Ethiopia’s political instability and the Tigray conflict escalate the risks associated with high debt levels, potentially hampering its economic progress and ability to meet repayment terms.
Next on the list is Kenya with $6.69 Billion. According to the World Bank, the country is indebted to China for $6.69 billion. The loan was used for infrastructural projects such as the Standard Gauge Railway. The project was intended to boost connectivity and trade within East Africa, but it has been a contentious issue due to its high costs and doubtful economic viability.
The project has also generated fears of increased taxation and austerity measures as the government struggles to meet repayment schedules.
Zambia is also on the loan list with $6.08 Billion. The country’s Chinese debt has increased its dependence on Chinese financing for mining and infrastructure projects.
It has seen significant Chinese investment in its mining sector, leading to economic difficulties and a high debt burden, inflation, and currency devaluation.
Bangladesh owes China $6.05 Billion. The country’s debt to China has financed infrastructure projects such as power plants and bridges. While these developments are essential for its economic growth and development, the debt level raises questions about fiscal sustainability.
Laos owes China $5.25 Billion. The tiny country borrowed the sum mainly from building the Laos-China Railway. The project aims to transform Laos into a land-linked country to boost trade and connectivity.
Egypt also owes China $5.21 Billion. The North African country’s debt has been used for infrastructure such as the New Administrative Capital. These projects are part of Egypt’s more extensive strategy to modernize its infrastructure and attract foreign investment.
Nigeria is also on the list of China’s debtors with a whooping $5.29 Billion.
The West African country’s debt is used mainly for infrastructure projects such as railways, highways, and power plants.
Edited from Legit
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